For the last several years, Web sites have operated under a form of self-regulation, and industry groups have touted the ever-increasing number of sites posting privacy policies. However, members of the Senate Commerce Committee today decried those steps as inadequate and cited polls showing that the vast majority of consumers opposed industry self-regulation.
The senators acknowledged that with Congress set to adjourn as soon as Friday, no legislation will be passed before next year. One senator who called for new laws told News.com outside the hearing room that the industry should view the hearing as a "shot across the bow" and use the time available to improve Web site privacy policies.
"The time has come to enact legislation to protect consumers' privacy," McCain said at the hearing.
A recent report by the Federal Trade Commission was behind some of the senators' frustrations. McCain said the study found that only 41 percent of randomly visited Web sites and 60 percent of the top 100 sites "provided consumers with notice about their information practices and offered a choice about how that information is used."
Sen. Ernest Hollings, D-S.C., the highest-ranking Democrat on the committee, said, "I would have wished that the industry could be self-regulated." But he said privacy was only truly protected if consumers had to opt in before information could be used, rather than just being given a chance to opt out.
"Any bill that doesn't have 'opt-in' is just whistling Dixie," Hollings said.
Even the Senate champion of a moratorium on Internet taxes, Democrat Ron Wyden of Oregon, said he supported legislation. "I don't think it's right to wait until there's an Exxon Valdez of privacy," he said, referring to the 1989 oil spill. He added that a privacy crisis would "drain much of the confidence out of the Internet economy."
Others calling for legislation included Republican Sens. Conrad Burns of Montana and Slade Gorton of Washington, and Sen. John Breaux, D-Louisiana.
Some witnesses defended the industry's self-regulation efforts at the hearing. "We think the private sector has done a good job of responding to privacy concerns," Hewlett-Packard technology policy manager Scott Cooper said. "Self-regulation and credible third-party enforcement" is superior to legislation, he said.
America Online's chief lobbyist, George Vradenburg, said there was room for legislation, but he urged Congress to work with industry leaders on it. He also said those at AOL "respectfully disagree" with Hollings on his desire for "opt-in" legislation.